The Reserve Bank of India has imposed monetary penalties on Bank of India and Central Bank of India for non-compliance with various regulatory directions.
The RBI imposed a monetary penalty of ₹58.50 lakh on Bank of India for non-compliance with its directions on ‘Priority Sector Lending (PSL) – Targets and Classification’ and ‘Interest Rate on Deposits’.
The penalty was imposed through an order dated March 23, 2026, under provisions of the Banking Regulation Act, 1949, informed apex bank in a press release.
It added that the action follows the Statutory Inspection for Supervisory Evaluation (ISE 2025) conducted with reference to the bank’s financial position as on March 31, 2025.
Based on supervisory findings, the RBI issued a notice to the bank and, after considering its response and submissions, found charges to be sustained.
According to the central bank, the bank had collected ad-hoc service, inspection and processing charges in certain priority sector loan accounts with sanctioned amounts up to ₹25,000. It also failed to pay interest on certain term deposit receipts from the date of maturity till repayment.
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The RBI clarified that the penalty is based on deficiencies in regulatory compliance and does not affect the validity of any transactions or agreements entered into by the bank with its customers.
In a seperate development, Central Bank of India has been penalised ₹63.60 lakh for lapses in adherence to ‘Know Your Customer (KYC)’ norms and financial inclusion guidelines related to Basic Savings Bank Deposit Accounts (BSBDA).
The bank failed to upload certain customer KYC records within the prescribed timeline and opened multiple basic savings accounts for customers already holding such accounts.
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On the NSE on March 27, shares of Bank of India fell 3.02% to ₹144.99 declining ₹4.51 during the session, while shares of Central Bank of India declined 3.25% to ₹33.01, falling ₹1.11 during the session.
